Fraud Examination
6th Edition
ISBN: 9781337619677
Author: Albrecht, W. Steve, Chad O., Conan C., Zimbelman, Mark F.
Publisher: Cengage,
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Question
Chapter 12, Problem 6SC
To determine
The revenue-related fraud symptoms and list the fraud schemes in the given case.
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Fraud Examination
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- Both Siemens and their accountant KPMG and Walmart and their accountant EY failed to resolve the conflict between the integrity and independence of the external auditors and the business interests of the accounting firms. Instead, the two accounting firms put self-interest before the public interest and shareholder interest of their respective clients when their clients sought to maximize company profits by: a. Bribery of foreign government officials b. Customer Identity theft c. Aggressive Inventory method of accounting d. Aggressive Revenue Recognition inconstant with GAAP e. Failing to book interest income from special purpose entities.arrow_forwardRohini works as an accountant with PQR Ltd. She embezzled $20,000 from the company bank account. She was caught in the annual audit of the company. She justified her action saying that her employer has not given any pay rise, so she had to take $20,000 from the account. Explain in your own words the internal control that may have failed in the above situation. Also explain which element of the fraud triangle Rohini is referring to justify her action.arrow_forwardAn audit manager has led the audit of Topaz Ltd for the last three years. Evidence of a fraud involving the falsification of timesheets and supplier invoices to a significant value have been found. Senior management within Topaz are implicated. Discuss the extent to which the external auditor should be criticised for not discovering this fraud.arrow_forward
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